Farmers’ and fishermen’s associations and irrigation associations are the grass-root groups that have direct impacts on the stakeholders. Because of the changing socio-economic environment, these associations have to re-adjust and transform, so they can be efficient in their management and effective in their services, and be able to re-direct themselves toward the development of diversified services for the value-added agri-food industry.

1. Improving management of farmers’ and fishermen’s associations

1) For the transformation of the farmers’ and fishermen’s associations, the COA has revised the regulations on the associations’ financial management, auditing protocols, management of human resources, and duties and responsibilities of board of trustees and board of supervisors. Furthermore, the COA has allocated NT$334 million to the mutual-aid groups of farmers' and fishermen's associations with financial difficulties. This is to enable the members to take back self-paid and matching-paid membership fees after liquidation of mutual-aid groups. For the improvement of the associations' human resources, the COA has taken an active role in: 1) supervising the associations’ combined recruitment examination that have resulted in recruiting 429 new employees; and 2) providing training courses for Grade-VI employees, among whom 206 were promoted to Grade VII after the training. In addition, the COA has conducted 16 seminars for the associations’ leaders on the policy related to the New Agriculture Movement, eight training workshops for the associations’ 800 accounting staffs, four training workshops on finance management for the associations’ middle managers, and two meetings with 150 participants on the corporate identity system (CIS). During the year, the COA has assisted 20 farmers’ associations to adopt CIS.

2) The COA has assisted Taiwan Fishermen’s Association to conduct five examinations and recruit 411 new employees for various lower levels of associations. Training courses for 40 participants on fishery management and new technologies were held. Twenty university faculty members were invited to lecture in 36 consultation meetings in northern and southern Taiwan with 1,080 participants rendering solutions to technical difficulties confronting the fishing industry and guidance to modernize the fishing industry.

3) The COA independently offered NT$2.229 billion to assist the farmers in paying irrigation association membership fees and NT$500 million to help six irrigation associations that were facing financial difficulties. These offers have effectively reduced farmers’ average production cost to NT$5,864 per hectare, and maintained the associations’ routine operations for the benefits of 1.26 million members. In addition, the COA provided funds to Taiwan Joint Irrigation Association (TJIA) to mobilize its various programs such as staff training and workshops on improving association operations. The funding support was also used to invite experts and scholars to review the associations’ management, structure, impacts, and threats, and to set the directions for the associations’ future development and the plans for the associations’ re-organization.

2. Strengthening agricultural financing system

The COA has been active in supervising and assisting various aspects of agricultural financing organizations' operations to ensure they provide excellent services to the farmers and fishermen. By the end of 2006, the Agricultural Bank of Taiwan (ABT) has the deposits and the loans of NT$317.1 billion and NT$13.5 billion, respectively. These were increases of NT$221.5 billion and NT$10.4 billion, respectively, from the previous year. For the credit departments of all farmers' and fishermen's associations, they have the combined deposits, loans, and net loan of NT$1,373.9 billion, NT$661.9 billion, and NT$8.41 billion, respectively. There were increases of NT$4.9 billion, NT$67 billion, and NT$1.8 billion, respectively, from the previous year. The non-performing loans (NPLs) were NT$53.8 billion with NPL ratio of 8.13%; these were reductions of NT$11.1 billion and 2.78% from the previous year. During 2006, the earnings were NT$3.675 billion. That was an increase of NT$812 million from the previous year. The aforementioned clearly indicate that the business of Taiwan's agricultural financing organizations is on the right track. They carry capacities of risk-bearing, profiting, and improving capital quality.

To further improve agricultural financing system in the country, the COA has taken up the management of the Agricultural Credit Guarantee Fund (ACGF) in 2006. And to secure reasonable distribution of agricultural loans to strategic projects, the original 38 loan items have been consolidated into 12 items. The total amount of agricultural loans in 2006 was NT$41 billion, which is an increase of NT$3.7 billion from the previous year. To meet the demand from farmers and fishermen, the estimated loan quota in 2007 likely will reach NT$45 billion.

To strengthen the security system in credit departments and safety of tellers of various farmers’ and fishermen’s associations, a special program was launched on 24 March 2006. By the end of October 2006, 1,134 business centers of all 278 credit departments have completely upheld their security systems under this program. An evaluation of crime prevention capacities showed that these centers have reached the required safety standards much faster than banks and credit cooperatives.

To bring the market system into a full force, the Bureau of Agricultural Finance (BOAF) on its website provides monthly business information on various agricultural finance institutes. Furthermore, efforts have been taken to ensure the integrity of agricultural financial legal system by revising "the regulation governing the credit granting and credit limitation to the associated members and non-members by the credit departments of farmers’ and fishermen’s associations," "the regulation governing risk control ratios of the credit departments of farmers’ and fishermen’s association," and "the regulation governing business operations of the credit departments of farmers’ and fishermen’s association." These revisions shall facilitate moving forward various aspects of agricultural financing.